Delivering sustainable and student-focussed higher education reforms

Media Release
  • Minister for Education and Training

The Turnbull Government has welcomed the passage of its higher education reforms through the House of Representatives.

Minister for Education and Training Simon Birmingham said the reforms would ensure Australia’s world-leading higher education system was sustainable into the future while introducing measures that would help boost student outcomes.

“We want to give students more choices and to get the most bang for taxpayers’ bucks out of universities,” Minister Birmingham said.

“I’m pleased to see our reforms pass through the House of Representatives tonight and we are a step closer to delivering a system that drives better results for students and better value for money for taxpayers.

“This is a package of reforms that strikes the right balance.

“This is about setting Australian universities up for the future by empowering them to offer students better choices and holding them accountable for improved outcomes.”

Key elements of the higher education reforms include:

  • Better support for students – Legislating ongoing support for the $592 million Higher Education Participation and Partnerships Program but better targeting it to students who need it most, sector-wide transparency of admissions standards and entry pathways, supporting the establishment and maintenance of up to eight community-owned regional study hubs to meet the needs of the most remote students, better distributing postgraduate coursework places to institutions where students want to study, extending Commonwealth support to approved sub-bachelor level diploma, advanced diploma and associate degree courses so more students have more pathways to higher education, ensuring no student pays a dollar upfront for their course, and for the first time subsidising work experience in industry units of study.

  • Greater transparency and accountability – Entry requirements will be made more transparent and universities will be held to account for improving retention, completion and employment outcomes. We will ensure universities are accountable for how they spend public money by making 7.5 per cent of each university’s Commonwealth Grant Scheme funding contingent on performance against key benchmarks. In 2018 this funding will be dependent on participation in admissions transparency reform and cost of education and research transparency initiatives. From 2019, this funding will be dependent on performance metrics such as student outcomes and satisfaction, transparency and financial management with a formula to be developed in consultation with universities. Any funds withheld be reinvested into well performing universities, new equity measures or additional research funding.

  • A fairer deal for taxpayers – Phasing in increased maximum student contributions by 1.8 per cent each year between 2018 and 2021 cumulating to a 7.5 per cent increase and meaning there is a better balance of the contribution share between students and taxpayers from 42 per cent to 46 per cent for students and 58 per cent to 54 per cent for taxpayers, lowering the starting repayment threshold for loans to $42,000 with a one per cent repayment rate, restricting subsidies to Australian citizens only and certain Special Visa Category Permanent Residents from New Zealand and Humanitarian refugees, and extending a 2.5 per cent efficiency dividend in 2018 and 2019 to universities, recognising that university revenue has grown faster than costs over recent years.

“Taxpayers are footing the bill for around $50 billion of student debt with a quarter not expected to be repaid, funding for universities has increased by more than 70 per cent since 2009, effectively at twice the rate of the economy, and between 2010 and 2015 per student revenue jumped by 15 per cent while costs only grew by 9.5 per cent.

“Our reforms are about delivering the long-term sustainability of Australia’s generous student loan scheme. A HELP loan will still be one of the cheapest loans you will ever get.

“Under our plan, students will not pay a cent up-front and taxpayers on average will foot the bill for more than half the cost of a degree and fund loans which students start repaying at around $8 a week.

“Combined with our reforms to deliver students more choices, our performance funding for universities will ensure our higher education institutions are focused on student outcomes and satisfaction to ultimately drive an even higher-performing system.

Minister Birmingham said he would continue the constructive discussions he had underway with his Senate colleagues about the reforms.

“The only parties that have ruled themselves out of considering our reforms are Labor and the Greens,” Minister Birmingham said.

“Labor is choosing to ignore the fact when they were last in government they proposed indiscriminate cuts to higher education worth more than $6 billion. As usual, it pays not to trust what Labor says but to look at what they do.”

Full details of the Turnbull Government’s higher education reform package are available at: https://www.education.gov.au/higher-education-reform-package-0

For more information

Media Contact: media@education.gov.au
Non-media queries: 1300 566 046